CDW Corp (CDW)

Short-term

Turnover ratios

Inventory turnover measures how efficiently a company manages its inventory. CDW Corp's inventory turnover has been consistently high over the years, indicating that the company is efficiently selling its inventory. The ratio has increased from 19.53 in 2019 to 25.03 in 2023, showing an improvement in inventory management efficiency.

Receivables turnover reflects how quickly a company collects its accounts receivable. CDW Corp's receivables turnover has fluctuated slightly but remained relatively stable over the past five years. The decline from 5.31 in 2019 to 4.24 in 2023 suggests a longer collection period for accounts receivable in the most recent year.

Payables turnover assesses how effectively a company pays its suppliers. CDW Corp's payables turnover has also been consistent, with a slight decrease over the years. The ratio decreased from 6.62 in 2019 to 5.05 in 2023, indicating a longer payment period to suppliers.

Working capital turnover measures how efficiently a company utilizes its working capital to generate sales. CDW Corp's working capital turnover has generally been high, indicating efficient utilization of working capital to generate revenue. The ratio has fluctuated over the years, with a significant increase in 2023 compared to 2019, indicating enhanced efficiency in utilizing working capital.

Overall, CDW Corp demonstrates strong operational efficiency based on its activity ratios, with efficient inventory management, stable receivables turnover, consistent payables turnover, and effective utilization of working capital to generate sales.

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Average number of days

CDW Corp's days of inventory on hand (DOH) has been improving over the past five years, decreasing from 19.62 days in 2021 to 14.58 days in 2023. This indicates that the company has become more efficient in managing its inventory levels.

On the other hand, CDW Corp's days of sales outstanding (DSO) has been somewhat volatile, increasing to 86.02 days in 2023 from 76.08 days in 2022. This could indicate potential issues with collecting accounts receivable in a timely manner.

The number of days of payables for CDW Corp has also been increasing over the years, reaching 72.28 days in 2023 compared to 55.14 days in 2019. This suggests that the company is taking longer to pay its suppliers, which may have implications for its relationships with vendors.

Overall, CDW Corp's activity ratios show a mixed performance, with improvements in inventory management but potential challenges in accounts receivable collection and payables management that may require closer attention in the future.

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Long-term

CDW Corp's fixed asset turnover has fluctuated over the past five years, with a notable increase in 2022 followed by a slight decrease in 2023. The company's fixed asset turnover was significantly higher in 2022 compared to 2019, indicating that CDW has been able to generate more revenue relative to its investment in fixed assets in recent years.

On the other hand, the total asset turnover ratio has shown a declining trend since 2019. This suggests that CDW Corp's ability to generate sales from its total assets has decreased over time. A lower total asset turnover may indicate inefficiencies in asset utilization or a decrease in sales relative to the company's total asset base.

Overall, while CDW Corp has shown improvements in its utilization of fixed assets, there is a need for the company to address the declining trend in its total asset turnover to enhance overall efficiency in generating sales from its asset base.